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Group of experts created to help bring more affordable homes to London
The Mayor of London has released the first details of his plans to set up what he describes as a powerful Homes for Londoners team at City Hall to oversee home building in the capital and boost the delivery of new and affordable homes. As a first step Sadiq Khan has begun recruiting new experts to scrutinise 'viability assessments', the financial details that lie behind how much affordable housing new developments include. The experts, who will be drawn from finance surveyors and property consultant experts and be based at City Hall, will support housing delivery by making planning decisions faster and more consistent, and by ensuring new developments include the maximum amount of affordable housing. Khan will also lead a new Homes for Londoners board, formed of London Boroughs, housing associations, and developers. The board will oversee delivery, land assembly and investment decisions, and will draw on expertise from across the housing and property sectors to help develop new policy for the capital. ‘Home ownership has been slipping increasingly out of reach for more and more Londoners, and rents have been getting harder and harder to afford. I want to be honest with Londoners from the start that it will take time to turn things around,’ he said. ‘I am determined that Londoners get the same opportunities this great city gave me. That is why I am setting up my Homes for Londoners team to speed up home building and to move towards 50% of new homes in London being genuinely affordable to rent and buy,’ he added. A review of capacity and skills across the GLA will now get underway. Its aim is to ensure the Homes for Londoners team can play a more active role in the delivery of housing, particularly in bringing forward public land in London, and speeding up the planning process. This may also lead to additional expertise and support being recruited into the team in due course. David Montague, chair of the g15, said that Homes for Londoners will bring together the GLA, housing associations, local authorities and house builders to tackle the capital's housing crisis. ‘The priority now must be to build a long term pipeline of clean serviced and consented land. With this we can guarantee apprenticeships, jobs, economic growth, thriving communities and affordable homes. Without it, London will lose out in the competition for investment and growth,’ he pointed out. Baroness Jo Valentine, chief executive London First, which has published a major report on Homes for Londoners, described the move as an important and encouraging step towards solving the capital's housing crisis. ‘We want it to have a relentless focus on delivery, including getting more public land into the market,’ she added. According to Steve Bullock, executive member for housing, London Councils, believes that it will help all key agencies work closer together towards building the thousands of extra homes London urgently needs. Continue reading
Would be home owners in UK save for over four years for home deposit
Aspiring home owners in the UK believe they will need to save for more than four years in order to afford a deposit for their first home, new research has found. While most will safe for four years and four months some 27% believe that they will never be in a position to buy their own property, according to the report from insurance firm Aviva. Official figures show that the typical first time buyer home in Britain now costs £180,677. In order to save a 10% deposit, aspiring home owners starting from scratch would need to save £347 a month to build this deposit in four years and four months, assuming no interest growth. Despite property ownership becoming more difficult as UK house prices rise, under 45s believe home ownership will only become more important in the next 20 years, the report found. However, a clear distinction emerges between different age groups, with 73% of 16 to 24 year old and 60% of 25 to 34 year olds saying home ownership will grow in importance, compared to just 40% of over 55s. As younger age groups are the next generation of potential homeowners, it is clear that the desire to be a homeowner will continue to be very significant. Younger age groups are prepared to wait to get on the property ladder. Some 81% say that home ownership is perceived as a more important milestone in the UK than other parts of the world. On a personal level, 79% of people in the UK agree becoming a home owner is important to them or was, if they already are home owners. However, younger generations appear to accept that the path to home ownership might require some patience. Some 53% of over 55s say they want or wanted to become a homeowner as quickly as possible compared to 43% of 25 to 34 year olds, a key first time buyer age group. While 24% of over 55s say they don’t or didn’t mind waiting a while to become a home owner, this rises to 40% for 25 to 34 year olds. Despite the importance of getting on the property ladder, many people are failing to protect their possessions as 19% or 10 million UK adults do not have contents insurance if they own a home and 33% of those renting. The research also found that 40% of people don’t know the value of their contents insurance, leaving them at risk of being inadequately covered. In addition, 62% do not know how much their possessions and valuables are worth, potentially resulting in being under or over insured. ‘The UK’s households are changing, not just as the population grows, but as society evolves to include more family types. However, one thing remains constant and that is our desire to get on the property ladder. The next generation of home owners are certain this will… Continue reading
Gross mortgage lending slows in UK post Brexit
Gross mortgage lending in the UK held steady in July and was an estimated £21.4 billion, similar to June but 1% lower than July last year. The data from the Council of Mortgage Lenders (CML) is the first full month since the country voted to leave the European Union and it is too soon to see how much of an impact Brexit is having. CML chief economist Bob Pannell explained that the subdued nature of property transactions and mortgage lending in July are consistent with a less positive backdrop for house purchase activity post-referendum. ‘The Bank of England expects stronger economic headwinds to build as we move into 2017, and the Monetary Policy Committee’s package of monetary policy measures represents a spirited effort to lean against these on a timely basis. The MPC has pencilled in a further cut in Bank Rate later this year, but aims to avoid negative interest rate territory,’ he said. ‘The Term Funding Scheme should boost market sentiment a little, by engineering broader cuts to rates for existing mortgage borrowers than would have been the case, but it is not clear how well the Bank’s actions will underpin borrower demand in a more adverse economic climate,’ he added. Steve Bolton, founder of Platinum Property Partners, pointed out that the buy to let market was particularly impacted and purchase activity in June had almost halved compared to a year ago but the buy to let remortgage activity has picked up year on year. ‘Landlords are well positioned to benefit from falling mortgage rates as a result of the recent base rate cut. A mortgage can often be one of the greatest costs for landlords, so swapping to a more affordable deal is well worth the effort,’ he said. ‘Landlords are now operating in an uncertain political and economic environment, and further legislative changes which will phase out the ability to treat mortgage interest payments as a legitimate business cost could lead to many leaving the market or being deterred from expanding their portfolio,’ he explained. ‘This could lead to rising rents for many tenants and less affordable housing provision in the Private Rented Sector. It will therefore be interesting to see how this will have a knock-on effect on mortgage lending,’ he pointed out. ‘However, investing in property has proven to give strong returns when done effectively. It is now more important than ever that amateur landlords ensure they manage their properties professionally to build a profitable long term investment,’ he added. According to John Goodall, chief executive officer of peer to peer platform Landbay, despite some Brexit uncertainty it is clear that the property market, and in turn the mortgage market, is built on strong foundations, so the outlook is optimistic. ‘The UK’s housing shortage will remain a pivotal political and social issue, so we should expect buyer demand and lending levels to bounce back later in the year as the dust settles. In the meantime, it’s… Continue reading
